Housing

The Shadow (Inventory) Knows

What used to be dismissed as a bogeyman by real estate professionals is now a reality of unknown capacity: homes that fall into the shadow inventory of foreclosure. The December […]

What used to be dismissed as a bogeyman by real estate professionals is now a reality of unknown capacity: homes that fall into the shadow inventory of foreclosure.

The December report from Lending Processing Services indicates that one in every seven-and-a-half properties are either behind on payments or in foreclosure and that “more than 4 percent of the loans that were current in December 2008, fell behind by 60 days or more, including foreclosure, by the end of November 2009. It’s the highest rate for that part of the year since LPS began reporting the data.”

The foreclosure inventory continues to stack-up as the foreclosure rate in November reached 3.19 percent, a 1.46 percent increase from the previous month and an 81.41 percent increase from November 2008.

This inventory, however, doesn’t factor in the so-called “shadow inventory of foreclosure.” Housing Wire cites data from First American CoreLogic that puts that shadow inventory in the 1.7 million range as “the roadblocks of the government incentive programs and moratoriums clog the foreclosure pipeline.”

The Home Affordable Modification Program (HAMP), while having slowed down foreclosure starts, has largely been seen as ineffective in creating modifications on a permanent basis and, in many cases, only delayed foreclosure starts for already troubled properties.

Related Articles

  • Illustration of a right hand holding a small red two-dimensional house between thumb and index finger. The hand is dark blue and the arm, shown a bit beyond the wrist, is wearing a white shirt and suit jacket. The background of the image is a city skyline, in lighter shades of the same blue, with puffy clouds above.

    Ownership Matters: Institutional Investors and Corporate Ownership

    May 23, 2024

    Who owns our homes is an absolutely essential part of housing policy, and an even greater part of housing politics.

  • A Black woman in blue flowered dress and dusty pink hijab speaks into several microphones. In foreground, blurry, are news cameras. The woman is part of a large group at a rally, carrying signs promoting rent stabilization and saying "Home to Stay MPLS"

    Affordable Housing Sector Split on Rent Control

    May 21, 2024

    In the Twin Cities, where voters have recently supported rent control, most nonprofit housing developers have stayed silent, and some have openly lined up with the developers and landlords who oppose it.

  • Seven people wearing jackets and caps on a city sidewalk holding signs that say "Listen to UREB," "Save Our Homes," "Negotiate with UREB," or "5,000 Against Displacement." One person is speaking into a microphone. At the curb by the speaker is a van with WRLC painted on the side, for Western Reserve Land Conservancy.

    Nonprofit to Close Mobile Home Community to Build a Park

    May 10, 2024

    Ohio’s largest conservation land trust has been accused of purchasing a manufactured housing community with the very intention of closing it, evicting more than 100 households in the process. But proponents of the park’s closure say the land's failing infrastructure—and the benefit the property will bring to an entire city—is what forced the decision.